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Kik is struggling to mount a strong defense in a case brought by the U.S. Securities

As reported last month, Toronto-based Kik’s legal team attempted to persuade the district court of the Southern District of New York that the SEC’s case – alleging the 2017 token sale violated securities laws – was void based on the premise that the legal definition of an “investment contract” is unclear. Kik argued that this “vagueness” precluded the definition from applying to its “kin” token offering.
The firm also sought to depose SEC officials in a bid to show the securities watchdog wasn’t in a position to give clear guidance on token sales at the time of Kik’s ICO.
The SEC, not surprisingly, vigorously opposed the “void for vagueness” defense, stating at the time:
“This defense asserts that, notwithstanding 70-plus years of well-settled jurisprudence, the term ‘investment contract’ in the securities laws is void for vagueness as applied to Kik’s investment scheme. This claim is untenable and should be dismissed.”
Soon after our previous report, the judge in the case, Alvin K. Hellerstein, sided with the SEC view and refused Kik’s motion for discovery.